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Remarks by
Sandra Pianalto
President and Chief Executive Officer
Federal Reserve Bank of Cleveland
Baldwin-Wallace College
Graduate Commencement 2003
Saturday, May 10, 2003
Thank you and good morning.
President Collier, administrators, faculty,
friends, family, and, most of all, graduates, it is truly
an honor for me to share this very important day with you
— a day that you will long remember, even though you
will probably forget who delivered the commencement address.
To the relatives and friends of the graduates
in the audience we owe special thanks. Many of you have made
sacrifices to make this day possible, and you have every reason
to be proud of your sons and daughters, husbands and wives,
and other loved ones who are receiving their degrees today.
I suspect that you are one part sad, one part relieved, perhaps
one part broke, and many parts proud of your graduate. You
should also be proud of yourselves, because in many ways,
financial or otherwise, you have supported your graduate's
pursuit of advanced education.
To the graduates I offer my heartfelt congratulations.
This ceremony is the public recognition of what you accomplished
during all those late nights in the library and the long hours
studying — perhaps while juggling the demands of a job,
a family, or both. You can be very proud of your achievement,
with great justification. But while it's OK to catch your
breath and let out a huge sigh of relief, don't think for
a moment that the hard part is over when you pick up your
diploma and leave these hallowed halls. If the world were
static and predictable, the degree you walk away with today
might represent sufficient knowledge to sustain you throughout
your working life. But trust me, it doesn't. I daresay, whether
you are in the field of education or the world of business,
you will be in the business of learning from this day
forward.
Way back in the 20th century (I believe it was
in the 1980s), Alvin Toffler, the well-known author and futurist,
observed, “The illiterate of the 21st century will not
be those who cannot read and write, but those who cannot learn,
unlearn and relearn.” I am confident that there are no
21st century illiterates among us today. What you have learned
in your graduate program here at Baldwin-Wallace, in your
undergraduate studies, and in any experience out there in
the “real world” has formed a solid foundation for
a lifetime of learning. You have learned how to learn,
and you will continually discover an ever-changing menu of
what to learn as you navigate the twists and turns
of your career.
I say “twists and turns” because I
have a hunch that the career you are about to begin or to
resume — whether you have a new job waiting for you on
Monday morning or are still weighing multiple offers —
will be much different from the one you will have when you
retire. It used to be that an employee joined a company and
expected to stay there until retirement. I'm sure you know
that most people no longer expect to remain with the same
employer for their whole career. But it might surprise you
to know that nowadays, depending on which statistics we look
at, we know that today's average worker will change occupations
roughly three or four times during his or her career, as often
as once every decade or so. Such changes are natural in growing,
dynamic economies.
Because you can expect, on average, to change
occupations several times during your working life, you should
plan to build even more education into your career-development
plans at various points in the future. Not only will this
help insulate you from the unexpected twists and turns of
the economic environment, but it will also help you make planned
transitions less costly, whether they are transitions from
employer to employer or from occupation to occupation. Some
decisions to change occupations will be made by you as
you learn more about the opportunities available to you, given
your skills, abilities, and so on. How costly it is to change
occupations will be partly determined by how transferable
your skills are across the occupations. The benefits will
come in terms of higher wages, future opportunities, and job
satisfaction, among others.
Unfortunately, some occupational changes will
be out of your control as the occupational mix in the economy
changes over time. As an example, in 1950 roughly 20 percent
of working women worked as operatives, generally operating
machinery. By the year 2000, that number had fallen to about
6 percent. In 1950, only about 12 percent of the women who
were working worked in professional and technical occupations;
by the year 2000, that number had grown to nearly 27 percent.
Changing occupations successfully requires continuous
learning, and this is exactly what Toffler meant. And it is
my sense that it very well might be education that allows
one to change occupations without suffering too large a cost.
I guess my own career follows that model somewhat, because
even though I have had the same employer for the past 20 years,
I have been engaged in different occupations. And I'll tell
you, it wasn't only what I learned in college that prepared
me for the responsibilities I have today. Little did I dream
when I sat in “Introduction to Economics” as a sophomore
at the University of Akron that some day I would become a
federal policymaker. Moreover, no class or program —
not even those here at Baldwin-Wallace — can fully prepare
any of us for what we will need to know throughout our careers.
Yet long ago, I learned how to learn — not only how to
apply the knowledge I have gained, but also how to continually
add to that base through formal and informal means and how
to adapt my knowledge to changing circumstances.
I look at learning as an application of a fundamental
principle of economics. It's really an investment, an investment
in human capital. I don't need to tell the business graduates
that to invest means to give up something today for a higher
return some time in the future. What most of you gave up during
your time here at Baldwin-Wallace was the opportunity to work
and earn income. The payoff to that investment comes in greater
opportunities and income in the future.
For the past however many years you have been
going to school, you have been investing in your own human
capital. I encourage you to continually invest in your human
capital. Why? To point to a concrete example, we are undergoing
what many have called an information technology revolution.
What happens during a technological revolution? New types
of capital displace some, or much, of the older capital. This
is true for both physical and human capital. Some skills,
and even some occupations, become obsolete. At the same time,
the ability to adapt to new technologies will be highly rewarded
in the job market in terms of higher wages. So although you
will lose some of the human capital invested in a particular
technology, being able to switch from older to newer technologies
can more than make up for the loss.
It has been estimated that the wealth of a nation
lies foremost in its human capital, rather than its physical
capital. Some estimates imply that the value of human capital
is roughly three times greater than the value of the buildings
and machines used by that human capital. Therefore, it is
critical for our country's future economic well-being that
we invest in our human capital, and both of your fields —
business and education — will play critical roles in
that process. What does this all mean? It means that the business
of education and the business of business are not separate
spheres. Educators must understand the demands and needs of
a changing marketplace. Business must understand the role
of education and how it can help maintain the value of their
largest asset, human capital.
Lew Platt, who very successfully headed Hewlett-Packard
throughout most of the 1990s, once reminded business leaders
to "…think of how easy it is just to keep doing
what you are doing for a little bit too long…Formerly
successful companies did not make gigantic mistakes…the
only real mistake they made was to keep doing whatever it
was that had made them successful for a little too long…"
I offer you the same advice. Don't make the mistake of continuing
too long doing what has made you successful in the past. If
you don't keep up to date, you will have fewer choices as
occupations and jobs change over time. If you are not learning,
you are falling behind. Comfort and complacency are your enemies.
From time to time during your academic career,
you may have wondered why you were forced to take courses
outside your major field. One answer is that you were learning
to learn. When new theories, ideas, or business plans arise,
when certain occupations decline and others rise in their
place, you will be in a much better position not only to understand
them, but also to learn them and put them to use. As you move
through different stages of your career, some of the different
skills you have learned in this more formal learning environment
will increase in value, while other skills will lose value.
Your ability to adapt to new challenges will play a crucial
role in how well you achieve your goals. Motivation and a
thirst for learning will guide the successful workers of tomorrow.
The mark of a truly educated person is the recognition of
how much there really is to learn. Will Durant, the American
historian and student of philosophy, said it very well: “Sixty
years ago I knew everything; now I know nothing. Education
is a progressive discovery of our own ignorance.”
Lifelong learning is the only way to remain
competitive in today's job market. I encourage you to continually
invest in your own growth, development, and self-renewal.
Do so in the same way that a company invests in research and
development, then come up with “new and better”
products or services that you can offer. The value of your
human capital depends on your having a relentless drive to
update your credentials, acquire new skills, and stay abreast
of what's happening in your field. So take complete responsibility
for your career development. No one else has as much invested
in you as you do!
Up to this point, my remarks have revolved around
investment in human capital and education. In closing, I would
like to add one other form of investment: investment in your
family, friends, and health. As important as work is, work
alone doesn't make a life, even if you are continually
learning as you go. It is crucial to maintain a sensible balance
between your work and your personal life. I once heard about
a technique that I find very helpful in keeping this balance,
and I would like to share it with you.
You will have many responsibilities simultaneously
in your life — like having to juggle several balls at
once. Visualize that in one hand you hold a rubber ball, and
in the other hand you hold a beautiful, fragile glass ball.
The rubber ball represents your career, your work, and your
volunteer activities. The glass ball represents your family,
your friends, and your health. What happens if you drop the
rubber ball? It will bounce. Someone will pick it up for you,
or it will stay put until you are able to pick it up again.
What happens if you drop the glass ball? It may smash into
a million pieces. If you're lucky, it will only crack. But
either way, it will never be the same. So, along with everything
that you learn, there is something you should learn not
to do. Don't allow your justifiable concern with your career
to cause you to drop the precious ball that represents your
family, your friends, and your health.
As you leave here today, diploma proudly in
hand, I wish you the highest possible return on your continuing
investment in your personal human capital.
Tell you what. To celebrate your graduation,
take the rest of the weekend off. But first thing Monday morning,
I hope you'll pick up where you left off on lifelong learning!
Once again, congratulations and best wishes.
Thank you very much.
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